Wealth creation by the UK's leading companies increased by three times the rate of the rest of Europe, according to new figures compiled for the DTi.
The 2005 Value Added Scorecard also found that the UK has more companies in the top league than any other European country, creates wealth more efficiently and performs well across the majority of sectors.
The Scorecard found that the UK has more companies in the European top 600 than any other country – 167 - with a combined value-added (VA) of £347bn.
The UK figure is almost double that of Germany, whose 91 companies had a VA of £297bn over the year - a fall of one per cent. France is third with 84 companies who increased their total VA by five per cent to £277.5bn.
Eight of the leading 14 companies from 13 of the larger sectors are also from the UK.
The top 14 European companies by value added include five from the UK, five from Germany and three from France; there are three telecomms, three oil & gas and three financial companies. The top 14 companies in the UK 800 include five financial (all banks) and two each from oil & gas, pharmaceuticals & telecomms.
Value added (VA) is the difference between sales and the cost of bought-in materials, components and services. But while VA is a useful output measure of the wealth created by a company's activities, it is only one measure of company performance.
The Scorecard, compiled by Dr Mike Tubbs, Senior Industrialist with the DTI Business, Finance & Investment Unit, show that while the European business climate has improved over the past year, this improvement has been particularly marked in the UK.
The 167 top UK firms' added value has increased by 15 per cent from last year, compared to the average of five per cent in the rest of Europe. Meanwhile the VA for the UK's top 800 companies has increased by 12 per cent.
UK companies thus contribute 24 per cent of the European total, followed by Germany with 21 per cent and France with 19 per cent; all the other 19 countries have less than seven per cent of the total each.
UK companies also create wealth more efficiently, adding more value at lower cost. The UK efficiency rating is 163 per cent compared to 139 per cent for the rest of Europe.
However potentially less encouraging comparisons with US and Japanese companies are impossible because they do not give enough information in their annual reports to allow their VA to be calculated.
Patricia Hewitt, trade and industry secretary, said that the findings were a result of the government creating a stable macroeconomic environment for companies.
"This is an outstanding performance from top UK companies across a wide range of business sectors. Their wealth creation is the firm foundation for our prosperity," she said.
"But we must continue to build on this and not ignore threats from emerging economies. The clear message from UK success is that investment in the future generates sustained wealth creation."